Companies Cashing In On Allergies

By Eric Fox | May 03, 2010 AAA
Companies Cashing In On Allergies

Millions of people dread the coming of allergy season, when the pollen count peaks, causing a range of symptoms including watery eyes, nasal congestion, sneezing and a runny nose. Many of those suffering from the seasonal effects of what is known as allergic rhinitis, or hay fever, use a variety of prescription and over the counter medicines to treat the symptoms of allergies. (Ever wondered how to invest in drugs? Find out in Measuring The Medicine Makers.)

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Although the effects of hay fever are distressing to sufferers, the allergy business means big bucks for both U.S. and international pharmaceutical companies. These companies earn billions in sales off of many different branded products. The three main types of drugs used to treat hay fever are corticosteroids, antihistamines and decongestants. (Learn about three best-selling drugs in Stocks On Drugs: What It Takes To Get High.)

Corticosteroids
Corticosteroids are used to block the allergic reactions of hay fever sufferers. These can be taken as nasal sprays or orally. One popular brand of nasal spray is Nasonex, originally marketed by Schering Plough, which merged with Merck (NYSE:MRK) in late 2009. Net sales for Nasonex in 2007 and 2008 were $1.09 billion and $1.15 billion, respectively.

GlaxoSmithKline plc (NYSE:GSK) is also in the nasal allergy spray business and manufactures Flonase and Veramyst. Sales in 2009 for these two drugs were $332 million GBP.

Antihistamines
The next category of medicines is antihistamines, which blocks a chemical called histamine, released by the body during an allergic reaction. Claritin and Clarinex, once again marketed by Merck, are two popular antihistamines.

Prescription sales of Claritin brought in $425 million in 2008, and over the counter sales brought in another $405 million. Prescription sales of Clarinex were $790 million in 2008.

Allegra competes with these two medicines, and is marketed by Sanofi-aventis (NYSE:SNY), a large French pharmaceutical company. Net sales of Allegra in 2009 were 731 million euros.

Decongestants
The third category of medicines is decongestants. These include products such as Sudafed, Afrin and Actifed. These medicines are generally available over the counter, and work by constricting blood vessels and the flow of blood to the nose.

Leukotrienes Blockers
Singulair is used to treat chronic asthma sufferers, but is also used to treat allergic rhinitis. Singulair is marketed by Merck, and acts to inhibit the production of Leukotrienes by the body, which causes the allergic reaction. Singulair was Merck's largest selling drug in 2009, with $4.6 billion in sales.

While this is certainly a crown jewel for Merck, the patent on exclusive U.S. sales of Singulair expires in 2012, and sales of Singulair should drop fairly quickly after that. (Find out how patent law affects drug makers in Pharma Patent Trolls: Cheap Drugs At A Steep Price.)

Alternative Therapies
Many believe in using natural or herbal remedies to help with the symptoms of seasonal allergies. One favorite at the moment is butterbur, also called Petasites hybridus. It is an herb from Europe that some claim works as good as any antihistamine. Another recommended herbal remedy is a combination of Vitamin C and quercetin, a substance found in the skin of apples and red onions.

Others believe that using hot spices like cayenne pepper, hot ginger or fenugreek in foods can clear up the sinuses and provide relief. Also, some advocate using acupuncture or even hypnosis to cure this peaky seasonal ailment.

The Bottom Line
The number of medicines and homemade cures for hay fever are numerous and run the gamut from patent protected prescription drugs to cures that seem straight from a medieval history book. Hopefully, one of these methods will help the millions of people who suffer from this illness live more healthy lives. And, even if they don't, suffering investors can take comfort in at least having their portfolios benefit from their spring-time allergies.

Still feeling uninformed? Read this week's financial news highlights in Water Cooler Finance: Buffett's Armed and Greece Keeps Falling.

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